"It’s quite a remarkable story."
Rob’s business journey started around the age of five! It’s quite a remarkable story. His parents were both migrants with education high on their long list of values. His Syrian father came from a family of twelve and never really had the benefit of education, so it was important to them that they provides a sound education for their own children.
Looking back; Rob recalls, “I went to St. Bernard’s college in Essendon which is an all-boys Catholic school. I met a lot of lifetime friends and played competitive football. Sport was very big there. I was strongly disciplined at home and Dad made sure we applied ourselves at school.”
Coming from a close-knit migrant family in working-class inner-city Melbourne, Rob’s father was very keen on him having a degree. “It didn’t seem to matter what I studied. He never really put pressure on us, he just wanted us to have a skill because Dad drove a cab just to put us through private school.”
Rob recalls “Business was the only thing I was good at, and I got into Victoria University for a business degree. At enrolment, standing in a queue, is my now business partner Jason Cunningham. This journey with Jason started at the age of five at prep school, and went through primary and secondary school and then we happened to do the same degree. We’ve been in business together for the last eighteen years. So it’s been a long, long journey together.”
After university, reality struck for Rob on two major levels. “When I graduated in 1994 there was the biggest oversupply in accountants, so there just weren’t enough jobs. Dad was diagnosed with cancer on New Year’s Eve 1993, and I had six months to go in my degree, a really tough period. I kept applying for jobs and coming second. You’d apply for a graduate position with a firm, and there’d be 600 to 800 applicants!”
And over four months, Rob had almost given up finding a job. “I’d come down from 800 applicants to the last two and I missed three jobs in a row. I think the first time it happened it made me more determined. The second time it happened it nearly knocked me over, and the third time I just clashed with the older gentleman interviewing me. I really wanted the job. I was working as a sales rep selling chips to grocery stores, because I had to pay the bills, as dad was ill.”
Desperate times called for desperate measures, so “I rang the recruiter and talked him into getting me an interview with the owner. He couldn’t believe a 21-year-old could talk to him that way! He rang Kovac Partners though and spoke to Peter Kovac who gave me 15 minutes. I didn’t realise at the time how important those 15 minutes were, and what it would lead to, but I got the job. And that was the beginning of great change for me. Peter took a liking to me; taught me how to speak, how to conduct myself and how to run client meetings. So I was very much on a superhighway of learning, but I worked really hard at it.”
As is often the case, “It’s not until later in your life that you look back, whether it be a teacher at school, your father, your neighbour or someone you play competitive sport with who’s had an impact on you and your life. When I reflect on my life, it was Peter Kovac who really took me under his wing and taught me things well beyond my years. That gave me the grounding which enabled the rest of my life and work to have occurred.”
Whilst working with Kovac Partners, Rob also began to do tax returns for friends on the side and “funnily enough my business partner Jason who was working as a management accountant at Ford asked me to do his tax for him. I never really advertised myself but coming from a close-knit community where you stick together, I just started getting calls.”
At the ripe old age of 23 Rob thought, “I’ll have a go at business although there wasn’t really enough money as capital. I didn’t have enough clients to replace a wage – it was just friends and some family. Peter supported me but I didn’t take any of his clients. Some wanted to follow me; I said no and I’m very proud of that. To this day, Peter and I are still friends. I was still paying off my parents’ mortgage, and my dad had passed away after his battle with cancer.”
The Practice was born and Rob remembers, “within about six months I had quite a bit of work. I was still doing Jason’s tax, and he was telling me he’d run out of challenges at Ford and I suggested he come into business with me. I thought it would be good that Jason had a management accounting background and I had a tax background. I’d started off in January 1997 on my own, and by December 1997 I had a business partner and work was increasing”.
In 1999 the Howard government announced they were introducing a GST the following year. That was good news for the new business partners. “No one knew about the GST so we were going into a tax system which was relatively new for everyone – it very much brought us back to a level playing field.”
There have been many turning points over the 18 years the business has been in operation, and that was definitely a major one. “Jason and I went to just about every free seminar you could find on the GST. Jason also went through a course with CPA Australia.”
From that course, four people were chosen nationally to roll out an education program to other accountants on the GST and Jason was one of them. “From a management accounting background, Jason had started in this business in December 1997 and by mid-1999 he was a GST expert. He was running around the country rolling out presentations to hundreds of accountants that were 20 or 30 years his senior, and he was the authority on GST and I think that was a big turning point.”
It was a very basic operation in those days. “It was just the two of us, I had a computer, Jason had a computer. We drilled a hole in the wall and connected both of them – then we had an IT system!”
There are now about 50+ on the team and Rob proudly reports “it’s certainly growing at a rapid pace. Part of it is about constantly looking forward; refreshing and invigorating what it is that you want to achieve, and measuring yourself by what it is you want, and what measures of success you believe are relevant.”
It’s a very different business these days. Client expectations of their accountant or advisor have expanded considerably. “If you go back 30 years, people would go to a tax agent and ask tax questions. Now clients are asking legal questions, asking questions about investments – questions well beyond tax. I could see that there was going to be movement in what the offering was going to be for public practices based on the internet and information age and those expectations. A lot of advisory style work has resulted; sitting in on boards, financial planning, setting up self-managed super funds and arranging loans for business or investment. All of this grew out of the clients’ expectation of what it was they wanted from us”.
There is also considerable emphasis these days on the importance of leadership and the development of those qualities for client’s personnel especially for those businesses with 50 to 200 employees. “It’s something we’re quite passionate about. Leadership becomes a key ingredient in order to be able to get that leverage in the growth and development of people. And it’s also about passing on knowledge you’ve acquired and all these things become your culture.”
Culture to Rob is “not one or two things – it’s a combination of so many different ways you can improve, whether it be in a skill set or something which improves their relationship with their family. Is it qualities such as patience, listening and understanding they’ve developed in the workplace?”
Attracting and retaining talent is a very big priority for The Practice. “We want to look after our people and help them develop. They’re impressionable young people and we see it as our responsibility to help them find their way in the profession. We hope whether they stay with us for 3 years or ten, that they’ve left a better person than when they started. Perhaps one day they’ll be talking about us in the same terms as I’ve just talked about Peter Kovac.”
Client service stems from the partners “stripping it all back to the understanding that we’re in a service industry and irrespective of what we do, we’re providing a service. When it’s time to have fun we like to have fun, but when it’s time to service somebody we roll our sleeves up and do it; we’re in. Jason and I have always believed that you do whatever it takes.”
Rob’s role in the immediate future is to implement the firm’s strategic plan to set up offices in Sydney and Brisbane. “We want to build something that has a life way beyond us, leave a legacy and impact the profession. In order to do that we need to be in Sydney and Brisbane because that’s something quite special.”
In terms of staff, that will mean an increase to 100+ people in the next three years which doubles the firm’s current size. It will also involve “attracting some really, really good people and continuing to broaden the service, offering more to our clients in all our locations.”
“The next three year period is a really exciting stage in the growth and evolution of our firm, and one of the things that Jason and I have always said is that we will always do what we think is best for the business” Rob adds.
Has Rob’s role changed much in those eighteen years? “I’m still hands-on but I’m hands-on in a completely different role. I’d call myself a working CEO in that I still have a small client base I engage with and I really enjoy being an advisor. Now I’m also working on things like developing leadership and culture as well as executing our strategic plan and fulfilling our vision.”
Rob happily admits, “Undoubtedly the people we now have in place who are doing my old roles are much better at it than I was in ’97. And I think that had I not been prepared to let go of those roles, it wouldn’t have created the opportunity for the people to take on those roles and become better than me at it.”
As in all businesses, The Practice and its staff are dealing with people. “We’re in the relationship business; we have relationships with our clients and part of our uniqueness is that our clients have a relationship with us, not a transaction.”
Sport has been pivotal for Rob in terms of his development and he’s incorporated that experience into his management style. “Given the size of our team, being able to understand who the best person for the role is, and how to work well with and support each other has been massive. It’s also important to develop people who have certain aspirations; very similar to a sporting team. It’s been a really good grounding for me to help me understand people.”
Rob’s definition of success revolves around the utilisation of skills, and the realisation of full potential. “If you’ve done the best that you can do with the talents and the skills you’ve been given, I think that’s a really good measure of success. The definition of success is sometimes too aligned to money or material things.”
For someone starting out in business, or a young entrepreneur, Rob’s advice is “firstly start with the question why? Why are you doing what you do? I’m a big believer that people don’t buy what you do, they buy why you do it. I think being able to impact a business from scratch, right from the beginning is a really good place to start. Why are you going into business? Be really honest with yourself. Secondly, be clear and focused on what it is you want to achieve. Thirdly, have some mechanisms in place to be able to measure how you’re going. Financially, we have a budget, but what are the non-financial measures that will show you you’re on the right track?”
Who does Rob respect in business? “There are a number of people who have had a huge impact on me. Peter Kovac who took me under his wing and taught me so much, I’ve got an enormous amount of respect for him, and he definitely had a big impact on my career. And Jason Cunningham, my business partner, with whom I’ve been to primary school, secondary school and University and spent 18 years in business with is a guy I respect for his ability to learn, and to set himself challenges and really go after them with everything he’s got. By raising the bar he helps others around him want to get the best out of themselves.”
Rob also proudly mentions the firm’s involvement in various community projects. One of these was working with The Hunger Project “to raise money and teach towns in Africa how to grow their own food. That was rewarding. We’re also very big on giving back to the education system in universities making sure we continue to develop young talent.”
Both Rob and his business partner Jason “feel very fortunate to be able to have the opportunities we’ve had in life and we want to make sure we’re passing that on. It makes you feel good when you’ve had a positive impact on somebody’s life in some way, shape or form and that’s a very important part of our culture here at The Practice.”
Rob Hadded is a Collingwood AFL tragic. It’s not just about the football, it’s also for the leadership lessons sport can provide business. For eighteen years Rob has run The Practice with his close school friend. His dream is to improve his lot, but to have fun at the same time.